New Schedule For Rating Permanent Disabilities To Be Implemented
April 1, 1997

A new Schedule For Rating Permanent Disabilities has been adopted
by the Division of Workers' Compensation effective for injuries which occur
on and after April 1, 1997.

According to DWC Administrative Director Casey L. Young, the new schedule:
overhauls the sections dealing with the occupation and age adjustments;
schedules some commonly used ratings that were previously unscheduled;
eliminates archaic, unused provisions; and adds extensive instructions,
examples, and other guidance in the proper use of the schedule.

The Schedule For Rating Permanent Disabilities sets forth standard
ratings for specific impairments and work limitations, creating a framework
of rating benchmarks which encompass most disabling conditions. The schedule
then sets forth procedures to rate impairments and limitations which fall
between the scheduled benchmarks. The schedule also sets forth procedures
to adjust ratings to account for the occupation and age of the injured
employee at the time of injury.

"The new schedule will be a much more useful tool to compute permanent
disability ratings," Young said. "The provisions of the schedule
governing occupational adjustments have not been updated for nearly half
a century. Occupations, the demands to perform occupations, and even the
provisions of workers' compensation law which provided the rationale for
varying compensation by occupation have all changed considerably since
this issue was last addressed."

No fundamental change is made in the approach to occupational adjustments,
Young said. The objective was to simply update, simplify, and clarify this
part of the schedule. Three basic steps were taken to achieve these objectives:

Occupational titles were updated to reflect those occupations currently
in use in the California labor market. The new list of about 1800 occupational
titles includes about half that are new, representing occupations that
did not exist in the 1940's.

Occupations were organized into an occupational grouping system based
primarily on information from the latest federal Dictionary of Occupational
Titles (DOT). The DOT classifies all jobs on the basis of strength and
various physical activities including climbing, balancing, stooping, kneeling,
crouching, crawling, reaching, handling, fingering and feeling.

An occupational variant structure was established and variants were
assigned using current knowledge about the physical requirements of occupations.
The most extreme variants, which applied to about five percent of all combinations
of disabilities and occupational groups, were eliminated.

Young explained why the most extreme variants were eliminated. "We
could find no rationale for the extreme variation in permanent disability
compensation based on occupation, which has increased dramatically since
the early 1980's. For example, an athlete with constant slight pain in
the neck, back, and upper and lower extremities now receives over $105,340
plus a small life pension, compared to about $28,647 for someone in an
occupation with the lowest variant for these disabilities. The current
difference of $76,692 compares with a difference of just $12,105 in 1983."

The other changes in the schedule were not as significant, but should
also be helpful in achieving more consistent disability ratings. The age
adjustment was simplified by changing the adjustment every five years rather
than every two years; some common unscheduled disabilities were added to
the schedule; archaic, unused provisions were eliminated; and the instructions,
examples, and other guides were expanded to help in understanding the proper
use of the schedule.

To determine the effects of the changes, a study was conducted in the
summer of 1995. Approximately 2000 cases which had been rated in 1993 were
re-rated using the new proposed schedule. This study indicated that the
overall effect would be to increase average permanent disability ratings
less than one half of one percentage point (from 19.8 to 20.2), and that
there would be no significant shifts between occupational groups, age groups,
or disability types. (See attached tables for actual results.)

"I am very pleased and proud of my staff for their monumental effort
and accomplishment in completing this schedule revision," Young said.
"In particular, Disability Evaluation Unit Manager Blair Megowan,
and Sharon Collins, who chaired the DEU Schedule Revision Committee, deserve
a tremendous amount of the credit for the completion of this project. The
entire DEU staff contributed to this effort and deserve credit as well."

Young noted, however, that there is one piece of unfinished business.
"The law also requires an update of the standard disability ratings
to reflect changes in the labor market, which is not part of this revision.
The Commission on Health and Safety and Workers' Compensation, which must
approve any change in standard disability ratings, has contracted with
the RAND Institute to obtain information to assist in this effort. I look
forward to working with the commission to devise updated standard disability
ratings when the RAND study is completed this summer."

Advance copies of the new Schedule For Rating Permanent Disabilities
are being distributed to interested organizations for distribution to their
members. As in the past, it will soon also be available from the Department
of General Services, Documents and Publications Section, P.O. Box 1015,
North Highlands, California 95660.

###

Table I

Permanent Disability Rating Change By Occupational Category

Occupational Category

Number In Sample

PD Rating Change (1)

Cleaners/Attendants

181

+1.65

Construction

273

-0.16

Drivers

212

-0.16

Hand Intensive

215

+0.54

Laborers/Material Handlers

250

+0.77

Machine Operators

99

+0.17

Mechanics/Installers

108

-0.30

Miscellaneous

231

+0.64

Professional/Technical/Clerical

426

+0.35

Total Weighted Average

1995

+0.41

Table II

Permanent Disability Rating Change By Age Category

Age Category

Number In Sample

PD Rating Change (1)

21 & Under

75

+0.28

22-26

217

+0.20

27-31

239

+0.36

32-36

327

+0.53

37-41

298

+0.13

42-46

264

+0.37

47-51

220

+0.37

52-56

169

+0.81

57-61

109

+0.89

62 & Over

79

+0.46

Total Weighted Avg.

1997

+0.41

Table III

Permanent Disability Rating Change By Disability Category

Disability Category

Number In Sample

PD Rating Change (1)

Brain/Nervous Sys.

28

-0.81

Chest

12

+0.56

Face/Head

5

+3.15

Hearing

24

+0.58

Lower Extremities

296

+0.22

Multiple

244

+0.79

Spinal/Abdomen

787

+0.46

Upper Extremities (2)

592

+0.30

Vision

7

-0.04

Total Weighted Avg.

1995

+0.41

(1) This is the average change in the permanent disability rating percentage,
not a percentage change in the permanent disability rating.

(2) It should be noted that the changes evaluated included a set of
proposed upper extremity guidelines, which are not being adopted at this
time. The effect on cost and benefits should not be significantly different
from the changes evaluated, however. As noted above, the change in ratings
of upper extremity disabilities changed less than one percentage point.
The rating of upper extremity work restrictions will continue to be done
by analogy to scheduled disabilities, as in the past.